Diminishing returns means returns on investment getting smaller and smaller. Remember mini means something small.

Edit: He means the increments in technology are smaller and smaller compare to what they were in the past. I think that was your actual question.

Agreed.  For the last sentence: the idea of each console having a unique gimmick would support this.  I don't think it will be a big deal, perhaps Switch 2 has analog triggers or something, I think Nintendo is done with the selling point gimmick. 

Still, as you said, you'd want to avoid cutting into new sales with old and I think the Switch is completely gassed.  A big bump in GFX and horsepower would breathe new life into old Switch games.  

Thanx for the explanation. Of course power leaps get smaller every gen. PS3/ Xbox 360 where massive compared to the PS2/ Xbox. The WiiU was massive over the Wii. The PS4/ Xbox One where not such big steps in graphics as we saw. At least i did not see major jumps. But PS5/ SeX(/SSBox) was a bigger jump compared to PS4/ Xbox One. We will see how Switch Up will do next year.

@Fight-The-Streets

Again i do not see Switch holding into the Switch 3(?)'s life, 2 years more is a dead lock!! Of course its a possibility. IF Nintendo gets around 12- 13 million this FY and next year will be more than the (by myself) expected 4- 6 milion sales (7 million/ 3DS salescurve) Switch might even be there longer than march 2027 but who knows. It also depends what games they'll announce for the Switch, how many cross gen games launch beyond 2027... My guess for now is, they'll give it a straight 10 years lifecycle like their previous handhelds got and thats it. But things can change of course...

Consoles usually are stopped being manufactured when the culminate yearly shippings fall below ~1 mil. We see in what year we will get there with the Switch.